Audit 6716

FY End
2023-06-30
Total Expended
$4.74M
Findings
2
Programs
2
Organization: Richardton Health Center (ND)
Year: 2023 Accepted: 2023-12-14
Auditor: Eide Bailly LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
4323 2023-003 Significant Deficiency Yes N
580765 2023-003 Significant Deficiency Yes N

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $4.71M Yes 1
93.498 Covid-19 Provider Relief Fund $35,250 - 0

Contacts

Name Title Type
MXKRXE767EB1 Mandy Robinson Auditee
7019743304 Renee Gravalin Auditor
No contacts on file

Notes to SEFA

Title: Community Facilities Loan Program Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Richardton Health Center (Health Center) under programs of the federal government for the year ended June 30, 2023. The information is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Health Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Health Center. Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Health Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. Expenditures reported in this Schedule consist of the beginning of the year outstanding loan balances plus advances made on the loan during the year, if applicable. The outstanding balance as of June 30, 2023 was $4,562,349.
Title: Provider Relief Funds and American Rescue Plan (ARP) Rural Distribution Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Richardton Health Center (Health Center) under programs of the federal government for the year ended June 30, 2023. The information is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Health Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Health Center. Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Health Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The Health Center received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (PRF) program (Federal Financial Assistance Listing #93.498). PRF expenditures were recognized on the Schedule when the expenditures were included in the reporting to HHS for Period 4 and Period 5, defined as payments received between July 1, 2021, and June 30, 2022. The total amount of PRF received of $35,250 was included on the Period 4 report submitted to HHS, that amount is shown on the accompanying Schedule. The total amount of PRF expenditures included on the Schedule requires management to make estimates and assumptions that affect the reported amounts. Accordingly, such expenditures are considered a significant estimate. Estimates and assumptions may include reducing actual expenses by amounts that have been reimbursed or are obligated to be reimbursed by other sources and estimating marginal increases in expenses related to coronavirus. Actual amounts could differ from those estimates.

Finding Details

2023‐003 United States Department Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grant Cluster Special Tests and Provisions Significant Deficiency in Internal Control Over Compliance Criteria – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition – During our testing, there was no formal review separate from the preparer over the reserve fund reconciliation for the federal program and there was no formal review of the balance in comparison to the required minimum reserve balance. Cause – The Health Center did not have an adequate internal control policy in place to ensure review and approval over the reserve fund. Effect – The lack of adequate policies governing review increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Questioned Costs ‐ None reported. Context ‐ Sampling was not used. The Health Center has one reserve account, which includes the debt service and emergency and replacement reserve, that was tested. Repeat Finding from Prior Years – Yes, Finding 2022‐004 Recommendation ‐ We recommend that the Health Center enhance internal control policies to ensure that formal documentation of reviews is present. Views of Responsible Officials ‐ Management agrees with the finding.
2023‐003 United States Department Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grant Cluster Special Tests and Provisions Significant Deficiency in Internal Control Over Compliance Criteria – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition – During our testing, there was no formal review separate from the preparer over the reserve fund reconciliation for the federal program and there was no formal review of the balance in comparison to the required minimum reserve balance. Cause – The Health Center did not have an adequate internal control policy in place to ensure review and approval over the reserve fund. Effect – The lack of adequate policies governing review increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Questioned Costs ‐ None reported. Context ‐ Sampling was not used. The Health Center has one reserve account, which includes the debt service and emergency and replacement reserve, that was tested. Repeat Finding from Prior Years – Yes, Finding 2022‐004 Recommendation ‐ We recommend that the Health Center enhance internal control policies to ensure that formal documentation of reviews is present. Views of Responsible Officials ‐ Management agrees with the finding.